Passing-on

There are three distinct elements that make up the recoverable harm potentially suffered by a claimant. First, there is the increase in the claimant’s costs (“the overcharge”) that may be brought about by the infringement: in legal terms, actual harm or direct loss (damnum emergens). Such harm may arise directly or because of “upstream” pass-on by a direct or indirect purchaser that supplies the claimant. Second, the adverse impact of the overcharge on the claimant may be reduced if it passes on some or all of that overcharge to its own customers, by means of a price increase. This is the “passing-on” effect. Whilst such “downstream” passon reduces the actual harm suffered by the claimant in question, it will do so at the expense of causing harm further downstream. Indeed, the pass-on effect at one level of the supply chain implies an overcharge of the same magnitude at the next level downstream; they are two sides of the same coin. In litigation, pass-on can, therefore, serve as a “sword”, where an indirect purchaser alleges that an overcharge has caused it harm because of upstream pass-on. It can also be used as a “shield”, where a defendant alleges that downstream pass-on by a claimant has reduced the actual harm the latter has suffered. Third, to the extent that a claimant suffers a loss of sales volumes as a consequence of pass-on, it will lose the profit margins associated with those sales. This so-called “volume effect” constitutes recoverable loss of profit (lucrum cessans) in legal terms and forms part of the overall damage calculation. Whenever a firm increases its prices, it will almost invariably suffer such a loss of sales volumes. It is the extent of this prospective loss, which hinges on the sensitivity (or elasticity) of a firm’s demand to price increases, that tempers the extent of passing-on in the first place (Study on the Passing-on of Overcharges, Final Report, RBB Economics and Cuatrecasas, Goncalves Pereira, 2016).

Dutch trade association of civil-law notaries to adjust information on passing on fees*
The Netherlands Authority for Consumers and Markets (ACM) has urged the Royal Dutch Association of Civil-law Notaries (KNB) to adjust the information about passing on a fee for the ’Notarial Quality Fund (in (...)

We introduce the reader to three stylized scenarios often referred to by practitioners when asked about the share of a cartel overcharge that was passed on from direct to indirect suppliers. We show how sensitive such predictions are with respect to many of the underlying assumptions. Even (...)

The European Commission has issued guidelines for national courts on how to estimate the passing-on of overcharges to indirect purchasers of goods and services affected by infringements of Articles 101 and 102 TFEU. The guidelines have been issued pursuant to Article 16 of the Antitrust Damages (...)

ABB/BritNed
Luís Campos Associate Director, Frontier Economics, Paris/Londres
On 9 October 2018, the High Court of England and Wales issued its judgement on the litigation opposing ABB and BritNed, following a 2004 decision by the European Commission (EC) which found that ABB had participated (...)

Introducing the annual Concurrences Paris conference of March 28, 2019, Mrs. Chantal Arens stressed that the work was in line with the reflection that leads the Paris Court of Appeal with universities and practitioners around future legislative developments. In addition, this conference was (...)

The commented decisions indicate the recurrent nature of procedural questions, especially those pertinent to national and international competence. Other decisions confirm the ever-growing litigation about compensation applying to the administrative court as well as the importance of the harm (...)

Rule of reason, passing-on defence, per se infringements, extraterritoriality, illegally obtained evidence, alternative explanations, indirect evidence are only some of the notions interpreted and applied by competition law courts on both sides of the Atlantic. Do the judges analyse and apply them in a similar fashion? Given that two courts of the same jurisdiction may hold differing views on the same issue, one might say that the question is not worth asking. But still. The question is worth asking when various jurisdictions are compared, each one taken as a whole, with a focus on the substance rather than on differing formulas. This special issue brings together a critical mass of articles enabling the practitioner to gain an overview of complex matters in a concise but also precise way.

The decisions commented in this article confirm the main features of the private enforcement of antitrust law in France. It is still a varied litigation between businesses. In follow-on litigations, claimants experience some recurring problems regarding prescription and passing on defence. In (...)

In recent years, damages litigation in Europe has been marked by the implementation of the Damages Directive across most EU countries. Reflecting this, a number of recent articles in this edition report on the details of the implementation of the Directive across the EU.

Indirect purchaser plaintiffs’ motion for class certification in a lithium ion battery suit was denied for failing to show concrete evidence linking increased input costs to increased end-product prices; theoretical inference is not enough.
What happened: The US District Court for the Northern (...)

This section selects books on themes related to competition laws and economics. This compilation does not attempt to be exhaustive but rather a survey of themes important in the area. The survey usually covers publication over the last three months after publication of the latest issue of (...)

On 12 June 2017, the Act implementing the EU Damages Directive into Belgian law was published in the Belgian State Gazette. The Act adds a new chapter to the Belgian Code of Economic Law.
The EU Damages Directive (Directive 2014/104/EU, the Directive) sets out rules which must ensure that (...)

Today, significant changes to the German Act against Restraints of Competition have entered into effect. This newsletter provides an overview of the most significant aspects of the 9th amendment to the German competition law.
Cartel Damages
The amendment strengthens the procedural and legal (...)

On June 6, 2017, Belgium adopted legislation ("Law") transposing the EU directive on private antitrust damages (Directive 2014/104, ("Directive")). The Law became applicable on June 22, 2017, and is expected to boost private competition law enforcement in Belgium and should enhance the full (...)

Today marks the entry into force of the law which implements Directive No. 2014/104/EU of the European Parliament and Council of 26 November 2014 on certain rules governing actions for compensation of damages arising out of anti-competitive practices (the Damages Directive) into the Belgian (...)

The government has issued an urgent Royal Decree-Law 9/2017 of 26 May (RDL) implementing Directive 2014/104/UE, of the European Parliament and the Council, of 26 November 2014 (Directive) into Spanish law. A Royal Decree-law is an instrument used by the government to legislate on matters that (...)

Introduction
The National Assembly of the Republic of Slovenia adopted in May 2017 the Act amending the Prevention of the Restriction of Competition Act (hereinafter referred to as the Competition Act), thus completing the process of implementing the Directive 2014/104/EU of the European (...)

The decisions commented in this article confirm the main features of the private enforcement of antitrust law in France. It is still a varied litigation between businesses. In follow-on litigations, claimants experience some recurring problems regarding prescription and passing on defence. In (...)

On 29 March 2017, the District Court of Gelderland (the “Court”) dismissed a passing-on defence put forward by the Swiss technology company ABB in a cartel damages case initiated by the Dutch network grid operator TenneT. TenneT claimed that it had incurred damages as a result of higher prices (...)

On March 10, 2017, the German Parliament adopted the 9th amendment to the German Act against Restraints of Competition (“9th Amendment”). While many of the revisions are of a declaratory nature, some changes should make cartel damages actions in Germany more attractive – in particular the new (...)

On 10 March 2017, France finally implemented into French law the EU Directive 2014/104 of 26 November 2014 on antitrust damages actions (see our Special Report) through Order n° 2017-303 and its implementing Decree n° 2017-305 of 9 March 2017. France was more than two months late, but there are (...)

National courts in Europe have handed out over fifty judgments in cartel damages claims, and have awarded damages in at least 23 cases. In these cases, the courts have reviewed various methods for quantifying cartel overcharges. Rather than economic or econometric modelling which is sometimes (...)

Italy now has legislation allowing legal actions to seek compensation for damages caused by violations of anti-competition law, starting from 3 February 2017 when Legislative Decree no. 3 of 19 January 2017 ("Decree") will come into force.
The Decree implements Directive 2014/104/UE and (...)

Legislative Decree no. 3/2017 (“Decree”) enters into force today, implementing in Italy Directive no. 2014/104 / EU of the European Parliament and of the Council of 26 November 2014, which sets the rules governing actions for damages caused by infringements of EU and national competition law. (...)

The new Swedish Competition Damages Act*
The Swedish implementation of the Directive on Antitrust Damages Actions (the “Directive”) is in force as of 27 December 2016 with the entering into force of the Swedish Competition Damages Act (Sw. Konkurrensskadelag (2016:964)) (the “Act”). The (...)

The Damages Directive seeks to promote private enforcement of EU competition law before national courts across the European Union (the “EU”). The UK Regulations implementing the Directive were laid before Parliament on 20 December 2016 but will not come into force until after they have (...)

On 25 October 2016, the European Commission’s Directorate-General for Competition (“DG Comp”) published an expert study on potential approaches for national courts to assess the passing-on of overcharges in competition litigation (“the Study”).
The Study aims to provide judges and practitioners (...)

The passing-on “defence” after Sainsbury’s*The passing-on defence – ie. whether the damages suffered by a purchaser of a product which has been the subject of a cartel are reduced if he passes on the overcharge to his own customers – had, as Tristan Jones blogged a few years ago, been the subject of (...)

On 14 Jul the UK Competition Appeal Tribunal (CAT) issued its judgment in the damages claim brought by Sainsbury’s against MasterCard. The CAT found that MasterCard’s setting of UK multilateral interchange fees (MIFs) for its payment cards infringed the Article 101 TFEU/Chapter I prohibition on (...)

On 8 July 2016, the Dutch Supreme Court (“the Court”) handed down a judgment upholding the availability of the passing-on defense in private enforcement litigation. The ruling resulted from a civil claim for damages brought by the electricity company TenneT against the gas-insulated switchgear (...)

I. Introduction
A central aspect of the reform of EU competition law that has been undertaken since the turn of the new millennium has been to encourage private enforcement of EU competition rules. This initiative, as is well-known, is essentially inspired by the Commission’s perception that in (...)

1 Introduction
Damages actions under competition law have become a mainstream in many EU Member States. Competition practices in law firms and economics consultancies trumpet their expertise in damages alongside mergers, cartels and abuse of dominance. National judges are increasingly aware of (...)

Blown out of the water? Air Cargo and the future of extra-EU/EEA cartel damages claims*
If the captain of a trading ship fires cannon on a canoe to prevent the canoeists trading with another boat vying for their trade, that boat’s owners can sue the captain: Tarleton v M’Gawley (1793) Peake 270. (...)

A New but Dubious Concept of Advantage *
When the Commission orders recovery of aid that is intended to be passed on to final consumers, it must first calculate the amount, if any, that has been retained by the direct recipients of the aid. If the calculation is too complex, the Commission can (...)

Should State Aid that Is Passed on to Consumers Not be Recovered?*
Should the amount of recoverable aid be similarly reduced by the amount that is allegedly passed on to consumers? I will argue the case against it. Introduction
On 5 February 2015, the General Court, in cases T-473/12, Aer (...)

The round-table highlighted the importance of competition networks for small countries with limited resources. The debate is introduced with an illustration of the severe damage a German company suffered from anticompetitive behavior and is followed by a state of play of the development of (...)